Purplebricks: Disrupting UK Real Estate Agencies | In Practise

Purplebricks: Disrupting UK Real Estate Agencies

Former UK Chief Executive Officer at Purplebricks

Learning outcomes

  • Comparison of the real estate transaction in the 1990s versus today
  • How the portals have degraded the consumer experience for real estate agencies
  • Drivers of traditional agency fee degradation
  • The buyer and seller user experience and journey on Purplebricks
  • The economics of a unit instruction on Purplebricks
  • Potential for Purplebricks to increase the instruction fee and ancillary revenue
  • Opportunities in monetizing the buyer on Purplebricks

Executive profile

Lee Wainwright

Former UK Chief Executive Officer at Purplebricks

Lee has over 40 years of experience in the UK property market. He is the Former Chief Executive Officer of Purplebricks UK, the leading online estate agency in the UK. Lee joined Purplebricks as Chief Operations Officer in 2017 where he was responsible for scaling the number of agents and refining the pre and post-sale processes for local property experts. He was then promoted to run the UK business during a critical period of growth between 2018-19. Prior to Purplebricks, Lee spent 26 years running traditional agency branches and regions for leading brands such as Countrywide. Read more

Let’s say it’s pre-internet, 1990 and I’m selling my £200,000 house. What was that old process?

The research phase of estate agency pre-internet was very different. There were two elements to that research phase: what and where am I going to buy; and what am I going to get for my money? That was a very labor intensive journey of trawling through print, either newspaper or property magazines and travelling to estate agents, building relationships, getting yourself on mailing lists and it was quite hard work to understand the available inventory in estate agency in the UK.

Then the second side was, what’s the best route for me to sell my own property? Typically, three or four valuations from estate agents, lots of challenging questions to understand the dynamic. It’s slightly different today but people generally only moved every seven or eight years back in the 90s. It’s a little bit longer now, it’s 11 or 12 years, but it’s still the same sort of emotional decision-making process that you went through in terms of, am I going to sell my own home if I put it up for sale? Am I going to get a price? How am I going to be able to find somewhere to move to? I don’t really know what’s going on here; how do I build a relationship with an estate agent that I can trust?

That’s why it was very common for the estate agent that you found a house with to be the one that sold your property, and it became particularly relevant to build really good relationships focused on the human factor involved in the transaction. Estate agency, certainly in the 80s and 90s, was about personalities and people that had the skills to develop relationships and trust quickly and give consumers the confidence that they were the best people to represent them in a transaction, that was pretty significant in their financial life, but also something that wasn’t particularly common.

If I was selling my house, I would go down the street, find the estate agent branch, try and build a relationship with the agent and trust him or her enough to list and sell my property?

Correct, yes. Typically, you were out looking for a property and, in the process of looking for a property, you connected with an estate agent that just dealt with you in a way that you were comfortable with and, therefore, became the agent you chose to sell your house.

How would you look at the core responsibilities of the agent back then?

I think the hand-holding and educational element that was required back then was a very significant part of how estate agents won in the 90s. If your arena to compete and to be a serious player within the market was defined by anything, it was defined by your ability to engage with customers more often, more effectively and more meaningfully than your competitors.

Was it a typical journey where the agent would win the relationship, list the home in print channels and then the branch network would deal with all the back-office process and admin work?

Yes, pretty much. It was much more reliant on the telephone and a paper driven CRM approach. I showed somebody around a £200,000 house yesterday; they didn’t like it because the garden was too small and your £200,000 house that comes to market today has got a bigger garden. That’s the human intervention that can connect those two events together. Doing that well in the 90s was absolutely the difference between success and failure.

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Purplebricks: Disrupting UK Real Estate Agencies

August 23, 2020

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